Financial Planning in Times of Crisis

We recently saw a social media post warning people not to look at their 401(k) accounts as we are in the midst of a global pandemic related to the spread of COVID-19. And as many have noted, it is possible that if the illness itself doesn’t get you, then anxiety and worry could wear you down instead. You may or may not choose to look at your retirement accounts but you cannot ignore the need for financial planning at this time. Certain industries, companies, and individuals will see a loss of income and it is how they manage to recover that will make a difference in the long term.

Global Trade magazine examined the current global pandemic and its effect on the stock market, referencing what happened during the influenza pandemic of 1918-1919, concluding:

“It is comforting to see that when the final wave of the Spanish flu subsided in February 1919, the market began an increase of 50% which lasted until November of 1919.  Whether this increase occurred because of the end of World War I or the end of the flu or both is impossible to say, but it does provide encouragement that once the coronavirus begins to subside, the market will bounce back once again.”

According to some historians there were several waves of the illness at that time and it actually extended into 1920. People who didn’t panic but instead implemented a strategy to maintain financial stability may have fared better in the Roaring Twenties that followed.

You can reach out to your Fee-Only financial planner if you have questions about how  economic changes related to the Coronavirus will affect your financial planning and retirement planning.

If you have yet to consult with a financial planner, this may be the time to get the guidance of financial expert. Rather than worry, you can get the help you need to emerge from this crisis on solid financial footing.

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©Bring Clarity to Your Finances. Financial Planning in Times of Crisis is a post from Bring Clarity to Your Finances

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Claire Emory, MBA, CFA, CFP®

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